Stocks Rise on Earnings, Tame Inflation Data

NEW YORK -- U.S. stocks rose Tuesday as inflation data was seen keeping the Federal Reserve in an equities-friendly tone, while hopes rose for an easing of tensions in Ukraine.

Mixed earnings have been pouring in since Monday's closing bell, allowing the positive bent to spread. U.S. consumer prices rose in June as the cost of gasoline surged, but the overall trend continued to point to a gradual build-up of inflationary pressures -- allowing the Federal Reserve to continue to slowly take the foot off the stimulus pedal.

An index of homebuilder stocks rose 1.3 percent after separate data showed existing home sales rose in June at their fastest pace in eight months.

"Evidence of inflationary fear is not there. For the most part, the market is riding high on the earnings and ignoring the geopolitical message," said Andre Bakhos, managing director at Janlyn Capital in Bernardsville, New Jersey.

Pro-Russian rebels agreed to hand over the black boxes from the Malaysian plane shot down last week near the Ukraine-Russia border and the Malaysian government announced it also negotiated the release of the remains of nearly 300 victims.

The European Union threatened Russia with harsher sanctions over Ukraine, but France's president signaled the disputed delivery of a warship to Moscow would go ahead.

Traders will also keep an eye on the Middle East as Israel pounded targets across the Gaza Strip and said no ceasefire was near. Top U.S. and U.N. diplomats pursued talks to stop fighting that has claimed nearly 600 lives, an overwhelming majority from inside Gaza.

United Technologies (UTX) gave a rosy outlook but shares fell 2.7 percent to $109.96 and Coca-Cola (KO) dropped 3 percent to $41.11 after its sales missed estimates, weighed by stalling growth in North America. Travelers (TRV) dropped 4.4 percent to $91.08 after hail and wind storms in the United States increased catastrophe losses.

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The 7 Biggest Financial Mistakes 40-Somethings Make

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Stocks Rise on Earnings, Tame Inflation Data

If you've been making mortgage payments for a while now, it may have become just another task you do automatically each month. But it's time to start thinking about your end game. When will your house officially be paid in full, and how will that date intersect with your other plans? Do you need to adjust anything to make your "mortgage freedom" date align with the rest of your life? For example: Do you want to have your house paid off by the time your kids leave for college? If so, start scrutinizing the timing, so you can figure out if you need to make extra payments.

The average student graduating in 2014 emerged with $29,000 in student loan debt. There's no predicting what that number will be once your children are ready to don a cap and gown. But you don't want your kids to be saddled with tens of thousands in debt as they begin their adult lives (or potentially live in your basement well into their 30s because of that debt).

While your children should absolutely apply for every scholarship they can, you can't count on them getting what they'll need. So. there's no time like the present to start seriously building up their college funds. If you're not quite sure about the best ways for you to do that (529 plans are great, but they're not the only good choise), a fee-only financial adviser can walk you through your options.

Are you putting aside enough for retirement? Aim to replace 70 percent to 85 percent of your current income, or save 25 times your current annual expenses. Once you have that final number in mind, use an online retirement calculator or sit down with a financial adviser to come up with a plan for how much you'll need to save each year to reach it. If you haven't already done this, don't delay another day. Future You will thank you.

Credit card debt is a shackle that can prevent you from reaching every other monetary goal on your list. One of the first things you need to do to get your financial house in order is to eliminate all consumer debt -- the sooner, the better. Otherwise, you're losing money each month that could be put to better use elsewhere.

Make debt payoff a top priority. Try an aggressive method like the "debt snowball," where you throw every extra dime you can at your smallest balance until you've decimated that bill. Then move to the next one on the list and continue amassing "victories" until you're done with every debt. Where can you find the money to accelerate your debt payoff? Reduce your expenses or take a temporary second job, if necessary. The sooner you free yourself from debt, the better.

Your current vehicle won't last forever, no matter how diligent you are at taking care of it. When it comes time to buy a new car, will you have saved enough to make the purchase in cash? As you get older, you should be systematically reducing the number of financial obligations you're saddled with -- not adding on new ones. Car loans take from three to seven years to pay off. (The current average length is around 5½ years.) Even if your current car lasts you well into your 50s, financing a new one could mean that you'll be facing loan payments into your retirement years. Instead, plan ahead so you can pay cash.

If you're married, have children or support your parents financially, you should have term life insurance. Tragedies can happen at any time, and term insurance can help you create a Plan B for the benefit of those who rely on you. If you're healthy, you can get term life insurance coverage with a $500,000 benefit for roughly $29 a month. That's a small price to pay to know your family will be cared for if anything happens to you. The longer you wait to get that coverage, the higher your price will be.

Just like life insurance, disability insurance is a wise investment. (And, just like life insurance, the longer you wait to get it, the higher your monthly payments will be.) Should you fall ill or get injured and be unable to work for a period of time, disability insurance can pay out 50 percent to 70 percent of your income. Hopefully, you'll never need to use it -- but you never want to be in a spot where you do need it and you don't have it.